PIDE’s RASTA conference concludes

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ISLAMABAD, MAR 29: /DNA/ – Pakistan Institute of Development Economics (PIDE), under its Research for Social Transformation and Advancement’ (RASTA) program, concluded its first-ever RASTA conference at PC Bhurban. The research moot comprised diverse research themes, including energy issues, urban development, technology, and public service delivery, social sector development, markets and regulation, the political economy of development and reform, and sludge – the administrative burden.

In his concluding remarks, Dr. Nadeem ul Haque, Vice-Chancellor PIDE and Chairman RASTA Research Advisory Committee (RAC), said that the RASTA is an evolutionary process. Our local researchers and academics must conduct local research and find local solutions to our local problems.  He said that we can follow global research but it has to be adopted as per our local needs and requirements. Dr. Haque said that there is no looking back; we must only look forward to progress. We have already put enough ideas on the table for policymakers. Hope the policy corridors would take notice of it, the VC added.

He further said that local flavor to the research is all that we need. RASTA has researchers from across the country. At the first PIDE-RASTA Conference, we heard things we had never heard before. What does it tell? It implies that research has to be inclusive; to make a real impact.

Earlier during the session, Dr. Anwar Shah, Associate Professor at Quaid-i-Azam University, Islamabad presented his paper on ‘Informal Markets and Competition: An Analysis of Barriers to Entry of Legal Framework and Behavioral Attitude towards Khokha Markets in Pakistan’. Dr. Shah opened his talk by saying that Khokas (small vendor shops) is one of the key segments of the informal economy in Pakistan. Khokas provide jobs to many people and facilitate consumers in doing various types of transactions. However, entry to barriers put a bar on such access, leading to inefficiencies. The elimination of barriers to entry is important for promoting competition in the market and enhancing the welfare of people.

Umar Ijaz Gillani presented his research on ‘Regulatory Environment of the Professions in Pakistan: An Outline’.  What does it mean? He would tell you that it means fixing lawyers, doctors, town planners and so on. As these all together make up systems; rather broken ones at present and need to be fixed. All these groups have different environments but the essence of all is same. All have self-regulation bodies. Each group also have conduct elections to constitute governing bodies etc. amongst themselves.

Dr. Nasir Iqbal and co-authors presented pretty much similar case as of Dr. Shah but they took only Islamabad as a case study.  It is titled as “Revitalization of Street economy in Pakistan: The Case of Islamabad”. The study explores the legal and economic dynamics of Street Economy (SE) in Islamabad Capital Territory (ICT). Pakistan has a large SE operated by individuals and micro-enterprises across the country, mostly in urban areas. There are no precise estimates on the quantum of SE due to the informal nature in Pakistan. It is vital to gauge the contribution of SE in the overall economic landscape of the country due to the overwhelming involvement of individuals and micro-enterprises. This analysis helps to bring hidden employment and economic contribution to the national statistics.

The study reveals that average revenue of street vendor is PKR 114,708, 29% of which is profit. Formal market also get a positive spill-over effect from the traffic attracted by the street vendors. The study recommends that strong linkages are necessary for substantial gains.

Dr. Ahmed Waqar Qasim presented the findings of his unique study, titled ‘Sludge: The Administrative Burden’. First of all he defined the term sludge. Unjustified frictions that make it difficult for the people to achieve what they want, frictions that make processes unnecessary difficult, and unwarranted interaction between citizens and public institutions all comes under the definition of sludge. The examples may include complicated application processes, duplicative paper work, and various attestations and so on. Why does it matter? It matters because it limits the growth. It is distributive and reinforces inequality and sludge can also be employed for rent seeking. PIDE, for the first time in Pakistan attempted to quantify sludge through time consumed, cost involved and psychological cost. The figure is mind-boggling. PIDE’s sludge report says that in various sectors, sludge at the national level costs Pakistan 39% of its GDP.

During third and last session on the second day of RASTA Conference, four papers were presented under the theme – Political Economy of Development and Reform. The details are as below:

Dr. Faiz Ur Rehman presented his paper on “Political Dynasties and Local Economic Development in Pakistan’, co-authored by Noman Ahmad and Muhammad Nasir. Dr. Faiz started his presentation by saying that despite the considerable attention paid by previous governments to the underdeveloped regions, intra-regional economic disparities are on the rise in Pakistan. While there can be several reasons for exasperating inter-regional inequality across regions, political institutions and politicians may explain a significant size of this inequality. Politicians exercise considerable de facto political power to redirect resources towards their regions which has a substantial cost for least developed region.

Pakistan is among those countries where share of elected political dynasties in parliament is one of the highest in the world. It represents more than 50% of elected legislature since 1970, he shared with audience. 2008 onwards, the debate on the subject intensified and many levels, but little evidence or research was ever presented. Their study explored the impact of dynastic persistence on local development and public service provisioning. The findings suggest that constituencies with non-dynasts winners perform better than the dynast winners in terms of local economic development. The potential reason for the worse performance of dynasts could be associated with lower political participation, besides other factors. The authors suggests abolishing discretionary funds and minimizing the influence of legislators over PSDP spending can be an effective deterrent to cut down the divergence between the performance of dynasts and non-dynasts.

Professor Adeel Malik presented his paper on ‘The Political Economy of Non-Tariff Protection in Pakistan’. His paper examines the impact of political influence on trade protection in Pakistan. He enunciated that in 2012, Pakistan signed a five-year engagement plan with the European Union that paved way for its inclusion in EU’s Generalized System of Preferences (GSP) to allow duty free access to Pakistan’s exports. The GSP entailed a major harmonization of regulatory standards and led to a dramatic increase in the application of non-tariff measures across the entire manufacturing space. Some sectors experienced higher NTM introductions than others.

The findings show that MFN tariffs are consistently higher for political organized sectors. However, a clear divergence emerges between politically organized and unorganized sectors from 2008 onwards when regulatory duties are introduced. In the year 2013, a wave of new NTMs and introduction of customs duties, complicating the trade policy further. In a crux, regardless of how the sectors defined, politically influenced sectors have higher levels of trade protection in guise of import duties, particularly after 2013.

Zahid Ali, a PhD scholar from University of Peshawar and Noor Sanauddin presented their paper on ‘The Perspective of Native People Regarding Developmental Projects of China Pakistan Economic Corridor (CPEC) in Gwader, Balochistan’. He was of the view that Gwadar’s economic potential has become a center of debate in national and international media.

The study recommends employment opportunities to the natives, development of fishing and marine life policy, special developmental package for the fishing community, provision of drinking water and electricity supply, skill training and promotion of SME, awareness programs around CPEC projects and encouraging CSR could be few of the measures that can diminish the friction between the local community and CPEC authorities/ government.

Muhammad Arfan, a PhD candidate from Jamshoro presented his paper ‘Exploring the Water Governance Policy Framework for Improving Participatory Irrigation Management Reforms’. The author apprised the audience that Participatory Irrigation Management (PIM) was introduced to mitigate the inept management of the traditional irrigation bureaucracy. It was hypothesized that these reforms would have a positive impact on the crop productivity and enhance the conveyance efficiency of the system.